[Greens-Media] MEDIA RELEASE: Australian taxpayers should not prop up Gunns' pulp mill: Milne

[Willis, Katrina (Sen C. Milne)]

MEDIA RELEASE

Tuesday, 30 May 2006

Australian taxpayers should not prop up Gunns' pulp mill: Milne

The federal government should halt all public subsidies to Gunns'
proposed native forest-based pulp mill in Tasmania and explain to
taxpayers why their funds are being directed to a project which is
ecologically unsustainable and will never be cost competitive, the
Greens said today.

"Why is it that the federal government's passion for economic
rationalism is not inflamed by the report from CommSec that says that
the Gunns' pulp mill is not cost competitive?" Tasmanian Greens Senator
Christine Milne said.

"How much does the federal government estimate will be needed over the
life of the project to keep the factory running?

"Federal Forestry Minister Eric Abetz seems intent on throwing good
money after bad, hailing the latest gift to Gunns, a $60 million federal
government injection for road works on the East Tamar Highway, as paving
the way for the pulp mill whilst at the same time CommSec, a leading
stockbroker, has identified the project as not cost effective.
  
"It's just another damning indictment of the government's inability to
pick industry winners, having already poured over $200 million into
logging native forests in Tasmania. It is absurd given the government's
stated philosophical preference of allowing the market to allocate scare
resources - well, the market has spoken. 
   
"The Greens have always said that the plans by timber giant Gunns to
build a $1.4 billion pulp mill were an ill-conceived leap of faith - a
view now supported by Australia's largest stockbroker.

"It is ridiculous that the government should be so supportive of an
unsustainable sunset industry; it cannot compete against pulp sourced
from South American Blue Gum plantations. 

"For the past 15 years the Greens have argued that the market for old
growth woodchips would collapse by the end of the 1990s because of
plantations coming on stream from South America, and now it has
happened.

"We have also argued that any pulp mill should be not only
plantation-based but include a paper machine from the beginning because
the commodity market for chemical pulp is so volatile, the price trend
being downward for the past 10 years, a fact CommSec now confirms.

"The Howard government's economic strategy of backing every sunset
industry that 'digs it up, cuts it down or puts a road into it',
regardless of whether or not it is economically viable or ecological
sustainable, has reached new levels of ideological fanaticism with
Gunns' Tasmanian pulp mill project and it must stop."

Contact: Katrina Willis 03 6234 4566 or 0437 587 562


Katrina Willis
Adviser
Senator Christine Milne
Phone 03 6234 4566
Fax 03 6234 2144
Mobile 0437 587 562
www.christinemilne.org.au